Synopsis: Tier 1 cities are no longer the main centers of warehousing. Many tier 2 and tier 3 cities are now at the forefront of India’s logistics economy.
The Indian logistics and warehousing market is a rapidly growing sector. The industry is driven by e – commerce, manufacturing and consumption. It plays a vital role in India’s economic growth in terms of logistic performance. India ranks 38th position in the World Bank’s Logistics Performance Index. CBRE’s 2024 report shows that Tier 2 and 3 cities contributed 36% of new warehousing lease volumes, up sharply from 22% in 2021.
Tier 2 & 3 Cities Emerging as Warehousing and Logistics Hotspots
1. Lucknow
It is a promising North Indian Logistics market due to its strategic location along NH 27, a high speed link between 2 major cities. Amazon, Bharti Airtel, Delhivery and Gati KWE are some of the major players which are operating existing Grade B warehouses. The land is available for Rs. 70 – 80 lakh per acre and rental rates are around Rs. 10 – 15 per sq. ft. per month. There is excellent connectivity to Lucknow and Kanpur airport of around 35 – 45 minutes far. They are planning to develop A grade warehouses by increasing the investment.
2. Jaipur
The Jaipur warehouse and logistics market is growing driven by the state’s Rajasthan Logistics Policy 2025, Jaipur is a hub for industries such as textile manufacturing and engineering which fuels the growth for warehouse and logistics services. There are private, public and automated warehouses as well as specialized facilities like cold storage and bonded warehouses located in major industrial areas such as Vishwakarma Industrial Area and Sitapura Industrial Area. Major logistics include Mahindra Logistics and Safexpress.
3. Chandigarh
There is a surge in e-commerce, real estate prices and technology integration. This city focuses on modern flexible facilities, the city’s planned infrastructure and growing industrial base are making it a key hub for modern warehousing solutions. Major players include AR logistics, Core Logistics Pvt. Ltd, Om logistics, shiprocket fulfillment, Mahindra logistics. Major areas of warehousing include Manimajra, Zirakpur and Mohali.
4. Nagpur
It is a strategic central location in India, currently hindered by MIHAN SEZ industrial expansion, Nagpur has a diverse manufacturing base including textiles, steel and auto which fuels the need for logistics services. The major key players are WarelQ, Blue Dart Express, Gati Limited, VRL logistics, Safexpress etc. Warda Road , near MIHAN, Manish Nagar and Wadi are some of the major warehouse areas in Nagpur.
Also read: Major Industrial Corridors in South India Emerging as Global Investment Hotspots in 2025
5. Indore
Indore is an emerging logistic hub due to its infrastructure and cost effectiveness, supported by Madhya Pradesh Logistics Policy 2025. It has initiated Multi Model Logistics Parks. Key players of Indore warehouse and logistics market are RCPL logistics, Vivek logistics and Speed Movers logistics along with TCI Express, Gati limited and Blue Dart Express. Areas include Pithampur, Dewas and Sanwar.
6. Ahmedabad
Ahmedabad’s logistics and warehousing sector shows strong growth with a surge for leasing warehouses in H1 2025. It benefits from commercial hubs, engineering and textiles logistics services. Major players include TCI, Varuna Group, DHL and FedEx. The key areas of warehousing are located in Sanand, Changodar, Bavia and the Asiali – Kheda Cluster.
7. Coimbatore
It is a growing IT sector driven by the city’s industrial base in textiles, engineering and automobiles. It has largescale modern warehouse facilities with high-capacity storage. Key players are VSMC Logistics Park and OM Logistics. It has good connectivity to Bangalore and Salem. The major areas are Palladam, Avinashi Road, Kovilpalayam and Nesavalar Colony.
8. Kochi
Kochi warehouse and logistics market is growing by major infrastructure projects like Adani’s new logistics park and increased e- commerce. The key national and international players are Blue Dart, DHL etc and local operators like URBX Worldwide. Kochi major areas of warehousing include Kakkanad, Aluva and Palarivattom.
9. Visakhapatnam
It is a strong port city with growing industrial activity and ongoing government led reforms focused on modernization and sustainability. It is majorly focused on export and import of iron ore, crude oil etc. Major key players include Mahindra logistics, Gati, Safexpress and Balmer Lawrie. Major areas of warehouses are Parwada, Autonagar and Visakhapatnam Port Trust.
Final Thoughts
The Logistics and warehousing market in India is growing rapidly in metro cities as well as Tier 2 and Tier 3 cities in several parts of India due to major export and import activities in e- commerce and textile industry. There is an investment opportunity in the logistics and warehousing market as it provides good connectivity for several cities.
Written by M Soumya